Retirees who are eager to boost the income from their portfolios have been turning away from low-yielding government bonds and toward higher-yielding stocks. Embracing dividend payers can increase your investment income, but focusing too much on yield can expose retirement accounts to companies that are too risky. Rather than chasing yield, a better bet for retirees is to focus on high-quality companies that are likely to increase their dividend payouts in the future.
For example, these three top-shelf companies have catalysts that could propel their dividends higher: It shouldn't come as a big surprise that ExxonMobil's (NYSE:XOM)profits slipped last year as oil prices plummeted, but despite those headwinds, this energy giant still delivered shareholders $16.2 billion in earnings in 2015, including $2.8 billion in the fourth quarter. Patent risk is the greatest risk facing big pharmaceutical stocks, and Bristol-Myers Squibb (NYSE:BMY) isn't immune to that risk; however, the company has recently launched successful and fast-growing drugs that insulate it against patent expiration, and that may make it the best big pharma dividend stock for retirees to own. One of the most successful restructurings in the technology sector has been occurring at Microsoft (NASDAQ:MSFT), and its efforts to transition itself from being a leading maker of desktop software into a software-as-a-service, cloud-based kingpin are already paying off.